TMI Blog2023 (10) TMI 1126X X X X Extracts X X X X X X X X Extracts X X X X ..... s to doubt the truth or accuracy of the declared value in which event the proper officer is entitled to make assessment as per Rules 4 to 9 of the 2007 Rules. What is meant by the expression grounds for doubting the truth or accuracy of the value declared has been explained and elucidated in clause (iii) of Explanation appended to Rule 12 which sets out above-mentioned conditions when the reason to doubt exists. These instances are not exhaustive but are inclusive for there could be other instances when the proper officer could reasonably doubt the accuracy or truth of the value declared. The expression reason to doubt cannot be equated with the requirements of positive reasons to believe, for the word doubt refers to un-certainty and irresolution reflecting suspicion and apprehension - It is therefore held that in the context of the proviso to Section 14 read with Rule 12 and clause (iii) of Explanation to the 2007 Rules, the doubt must be reasonable and based on certain reasons . The proper officer must record certain reasons specified in Clause (a) to (f) Rule 12 or similar grounds in writing at the second stage before he proceeds to discard the declared value and de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Entry was 18144 kg. Thus 2976 kg. weight of the consignment was found in excess than the declared weight. The value declared in said Bill of Entry was also observed to be low. Accordingly, goods were seized under section 110 of the Customs Act, 1962. Further investigations and the panchnama of the even date was also drawn on spot. Statement of Shri Sandeep Kumar Goyal, authorized representative of the appellant, was recorded initially on 19.01.2017 and subsequently on 20.01.2017. The invoice was also observed to have no mention about the metal contents of the brass tap cartridge. Open market survey was also got done in presence of said Shri Sandeep Kumar Goyal. Based upon the said statement and the report of market survey that the declared assessable value of Rs. 28,08,128/- in the Bill of Entry No. 8051193 dated 02.01.2017 was rejected in terms of Rule 12 of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 hereinafter referred as Valuation Rules and the value was reassessed at Rs. 55,83,280/- with the total reassessed duty of Rs. 14,75,563/-. The already paid duty of Rs. 7,42,139/- was acknowledged to have been paid. The goods were confiscated with an opti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant offered for waiver of show cause notice and personal hearing. It is impressed upon that the payment of the amount demanded, in such circumstances, cannot be called as admission of alleged mis-declaration and under valuation by the appellant. The said acceptance has wrongly been made the sole basis for confirmation of the demand in the order under challenge. The order is accordingly prayed to be set aside. Learned consultant has relied upon the following decisions :- (a) Century Metal Recycling Pvt. Ltd. versus Union of India [2019 (367) E.L.T. 3 (S.C.)] ; (b) CCE ST, Noida versus Sanjivani Non-Ferrous Trading Pvt. Ltd. [2019 (365) E.L.T. 3 (S.C.)] ; (c) Golden Agro Corporation versus Commissioner of Customs, Jaipur I [ 2017 (354) E.L.T. 655 (Tri. Del.)] ; (d) Tini International versus Commr. of Customs (Import), Mumbai [ 2018 (364) E.L.T. 436 (Tri. Mumbai)] ; (e) Vijaya International Impex versus C.C. (Seaport Import), Chennai [ 2018 (359) E.L.T. 270 (Tri. Chennai)] ; (f) Hanil Automotive India Pvt. Ltd. versus Commissioner of Cus. III, Chennai [ 2021 (376) E.L.T. 522 (Tri. Chennai)] ; (g) Handtex versus Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2000 (117) E.L.T. 538 (S.C.)] and decision of this Tribunal also in the case of Saraswati Sales Corp. versus CCE [2011 (266) E.L.T. 237 (Tri. Del.)] has been relied upon. It is also mentioned that in light of section 17 (5) of Customs Act, the Adjudicating Authority was not supposed to pass a detailed speaking order. Decision of this Tribunal in the case of Commissioner of Customs versus M/s A.R. Fabrics as per final order No. 51856/2019 dated 19.07.2019 is also relied upon. Impressing upon no infirmity in the order under challenge, appeal is accordingly prayed to be dismissed. 6. Having heard the rival contentions of the parties and perusing the entire record, we observe that the basis of the order under challenge has been the market enquiry and the valuation in terms of Rule 7 of the Valuation Rules coupled with the acceptance of reassessed value by the appellant. The modus operandi for reassessment has been objected by the appellant. Hence foremost we need to look into as to what do we mean by valuation; when it can be rejected and how it should be reassessed. For the purpose, we need to look into section 14 of the Customs Act, 1962 and the valuation rules specifically 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the 2007 Rules i.e. Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 were enacted and enforced with effect from 10th October, 2007 replacing and superseding the 1988 Rules. [Rule 3(1) of Valuation Rules states that value of the imported goods shall be the transaction value adjusted in accordance with the provisions of Rule 10 of the 2007 Rules which Rule, as observed above, deals with the costs and services which are to be added to the price actually paid or payable for the imported goods for determining the transaction value. Sub-rule (1) to Rule 3 is however subject to Rule 12 and therefore give primacy to Rule 12 which we shall subsequently elaborate and explain. The proviso then vide different clauses sets out the pre-conditions for accepting value of the imported goods. Rule 11 provides for declaration to be given by the importer or his agent certifying that they had disclosed full and accurate details of the value of the imported goods and any other statement, information and document including invoice of the manufacturer or producer of the goods where the goods are imported from or through a person other than the manufacturer of goods, as considered n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... writing the grounds for doubting the truth or accuracy of the value declared in relation to the imported goods. Thus, the proper officer has to record reasons in writing which have to be communicated when requested. (h) The importer has to be given opportunity of hearing before the proper officer finally decides the transactional value in terms of Rules 4 to 9 of the 2007 Rules. Proper officer can therefore reject the declared transactional value based on certain reasons to doubt the truth or accuracy of the declared value in which event the proper officer is entitled to make assessment as per Rules 4 to 9 of the 2007 Rules. What is meant by the expression grounds for doubting the truth or accuracy of the value declared has been explained and elucidated in clause (iii) of Explanation appended to Rule 12 which sets out above-mentioned conditions when the reason to doubt exists. These instances are not exhaustive but are inclusive for there could be other instances when the proper officer could reasonably doubt the accuracy or truth of the value declared. The expression reason to doubt cannot be equated with the requirements of positive reasons to believe, for the word ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , while interpreting the provisions of Section 14 and Rules 3, 4 and 12 of the 2007 Rules, had held as under : 10. The law, thus is clear. As per Sections 14(1) and 14(1-A), the value of any goods chargeable to ad valorem duty is deemed to be the price as referred to in that provision. Section 14(1) is a deeming provision as it talks of deemed value of such goods. Therefore, normally, the Assessing Officer is supposed to act on the basis of price which is actually paid and treat the same as assessable value/transaction value of the goods. This, ordinarily, is the course of action which needs to be followed by the Assessing Officer. This principle of arriving at transaction value to be the assessable value applies. This is also the effect of Rule 3(1) and Rule 4(1) of the Customs Valuation Rules, namely, the adjudicating authority is bound to accept price actually paid or payable for goods as the transaction value. Exceptions are, however, carved out and enumerated in Rule 4(2). As per that provision, the transaction value mentioned in the Bills of Entry can be discarded in case it is found that there are any imports of identical goods or similar goods at a higher price at aro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nditions :- It is seen that the instant Rule and Notes to the Rule inter alia, envisage certain conditions e.g. (i) corresponding goods should be imported goods, (ii) there should be a sale in the greatest aggregate quantity in India, (iii) deductions towards commission, profits, general expenses, cost of transport and insurance, customs duties other taxes have to be made and (iv) sale should be at the first commercial level after importation. We observe that in the instant matter, (i) it is not known whether corresponding goods are imported or indigenous, (ii) there is no sale of any corresponding goods, (iii) although deductions have been made but there is no specific mention towards commission, profits (whole seller retailer), general expenses, cost of transport and insurance, customs duties other taxes etc., and (iv) since there is no sale, the point as to whether it is the first commercial level sale after importation, becomes infructuous . 11. None of the said conditions are applicable to the present set of facts and circumstances. Hence, we hold that Rule 7 has wrongly been applied and has straightway been wrongly invoked. Sequentially ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly stated that the appellant had declared the correct import value of the impugned goods. He also stated that the reason for the value as declared in the impugned bill of entry is that the gods are imported directly from the manufacture in China, that too in bulk quantity and pursuant to their personal negotiations with the said manufacture. Hence, he re-asserted on 19.01.2017 that the rate declared in the bill of entry are correctly mentioned by them. Appellants therefore have no reason to be concerned about the actual selling price of the impugned goods in the retail market. He also conveyed vide the said statement that their supplier i.e. manufacturer in China is not related to them except that they have continuous business relations with the said manufacturers. In the light of this statement, we are not convenience to accept the statement of the appellant made the very next day as a cogent admission. We observe that in the original submissions made on behalf of the appellant, it is mentioned that to avoid any delay and the demurrage charges, in case the consignment is held by the Customs Authority, that the appellant opted to pay the differential amount demanded by them. The vo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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